In recent months there have been significant moves towards peace in Afghanistan. In a national Loya Jirga on peace, 3,200 men and women from different tribes and groups, called for an immediate ceasefire. In Doha, US envoy, Zalmay Khalilzad, met Taliban leaders and other armed groups, to draft a peace agreement, involving withdrawal of the 14,000 US troops presently stationed in the country.
After 41 years of war, 39% of the population, including over a million displaced people, lives below the poverty line. More than 40% of the workforce is employed in the agricultural sector, and many rely on subsistence farming. Three years of drought mean over 10 million of people face food insecurity and possibly 6 million are in need of emergency humanitarian assistance.
With modest growth in GDP, languishing behind that of other countries in the region, Afghanistan badly needs to create revenue to support its people. It is a commonly held view that the country should develop its mining potential and bring its vast mineral resources to international markets. In 2017 mining accounted for only 0.97% of licit GDP, which falls to 0.92% when figures include the illegal opium trade.
The US Geological Survey values Afghanistan’s mineral reserves at $1trillion, although this staggering figure is based on historical British, Swedish and Soviet surveys, and recent air surveys, that only cover a third of the country. Afghanistan contains possibly the largest copper deposit in the world, deposits of gold, precious and semi-precious stones and sought-after industrial metals. Of particular interest for the global market are deposits of lithium, essential for the manufacture of batteries for smart phones.
So far, state mining operations have been hampered by antiquated machinery, lack of expertise and bad management. The government banned state mining for lapis lazuli in 2015 because of complex corruption. The country lacks the professional or technical expertise to produce its own surveys or to oversee the complex tendering process necessary to set up deals with foreign companies. For this it has relied up to now on the United States.
Artisan mining is an integral part of Afghan culture. Archaeological sites, such as the famous Mes Aynak site, are evidence of trade in metals and artefacts dating back thousands of years. There are numerous small mines dotted around the country. Artisan mining extracts gold and stones, such as emeralds, rubies, tourmaline, and lapis lazuli which are all available on the international market.
However almost all small scale artisan mining is now illegal or unregulated.
While lacking legal oversight, the miners are vulnerable to dangerous working conditions, such as fatal mudslides. With a plentiful supply of weapons, conflict between villages over mining rights can turn deadly. Other villages form armed groups to protect the mines from marauders. Mining can pollute vital water supplies, causing damage to farmland .
Illegal mining is one of the ways that armed groups finance themselves. The Taliban alone makes $300 million a year from illegal mining, leading to a culture in which armed groups profit from the chaotic security situation and see no incentive to work for peace.
The Afghan government is keen to encourage foreign investment in mining. Deals struck by the government with foreign private mining companies can include contractual obligations to provide employment, education, health care and other benefits for local people. But in existing deals, such as with the Chinese company MJAM for a giant copper mine at Mes Aynak, none of the promised benefits have happened and the project has stalled. Afghan Mining Watch have called for a deal with mining consortium CENTAR, pushed through in Washington last autumn, to be scrapped on account of irregularities in the contract, that go against Afghanistan’s current mining legislation.
As the World Bank suggests in its reports, the presence of a large scale mining project doesn’t offer many unskilled jobs. A diverse economy is needed to improve conditions for ordinary people. According to experts, Afghanistan’s mineral deposits could have no economic value when set against the cost of extraction, security and export.
Mining, as recent history in Latin America and Africa repeatedly shows, is often the cause of further instability and conflict. Large scale mining has led to land grabs, destitution and worsening conditions for local farmers, and increased violence against women. For all the excited news reports of deals ratified and potential revenues, mining remains a dangerous industry for a country lacking security. Lack of strong government means corruption is endemic. The Afghan government itself agrees it is not ready to oversee new mining contracts.